Wholesaling acts as a link and driver between industry and trade. In this role, in the course of digitalization, it is taking on a key role which is presenting it with two challenges: firstly, it must itself undergo a digital transformation process so as to be able to stand up to the competition over the long term. Secondly, it must integrate its customers into this process, especially small and medium-sized craft businesses, because many of these customers possess neither the appropriate digital equipment nor the adequate resources to cope with this transition independently – and thus to be retained as wholesale customers for the long term.
Such small and medium-sized workshops and craftsmen provide their customers with a complex mix of services and products. Geographical proximity, personal contact, trust and delivery reliability are critical factors in their success. If urgent orders cannot be met on time because small parts are missing due to forgotten repeat orders, this is not only annoying but even a danger to the business over the long term.
Small parts and/or C-parts such as screws, nuts, dowels, split pins and seals often account for 50% of the items processed in a company – because of their low value, however, they only make up a few percent of the operating costs. Unlike expensive components they are therefore not ordered for specific jobs, but instead stockpiled and re-ordered from wholesalers, in order to keep purchasing costs low. Especially in small and medium-sized craft businesses without their own warehouse management personnel, out of stock situations and costly overstocking frequently occur due to insufficient overview of stocking levels.
Minimizing purchasing costs for C-parts: automated processes with the Intershop Smart Shelf
In the scenario described above, digitalized business processes can also free considerable potential – both for wholesalers and their customers in trade. For example, with the Smart Shelf, Intershop is offering an innovative IoT solution (Internet-of-Things solution) for optimal inventory maintenance of C-parts in small companies: Intershop Smart Shelf is a sensor-equipped range shelf for C-parts, which autonomously monitors the stocks kept in it and when necessary automatically initiates online repeat orders with wholesalers – while the craft businesses’ employees can concentrate on their core tasks.
The shelf data measured by IoT sensor technology is passed on to the Intershop Commerce Management System of the wholesaler. Intelligent intermediate logic, realized via and hosted in the Microsoft Azure Cloud, allows the processing of the data, the derivation of stocks and requirements and the automatic triggering of deliveries.
In this process, the fully developed B2B functionalities of the Intershop Software Commerce Suite ensure that the ordering modalities negotiated between wholesalers and craft business can be individually configured: how often per day or week can the system order? How high are the maximum budgets for individual orders or ordering periods? From what amount must an order be confirmed once again by a personal e-mail?
The result is a win-win situation: with the Smart Shelf craft businesses receive fully automated inventory management for C-parts, adapted to their individual requirements, which not only massively reduces the process costs for orders, but also guarantees that their demand is covered at all times.
Wholesalers benefit in that they can profitably supply C-parts of small value to previously uneconomical smaller customers through a reduction of process costs. Apart from this, they increase the satisfaction and loyalty of these customers with needs-based deliveries, which leads to closer and more lasting customer retention. In addition, the Smart Shelf offers the possibility of acquiring current demand data of customers, and thus optimizing the operative purchasing planning and strategic corporate development.